I’m inclined to think so, and I’ve been thinking along similar lines myself. The bullish counterargument seems to hinge on the fact that they're not exercising the 5-cent options—citing the unchanged share count as supposed proof. However, we are already observing share count increases, as evidenced here:
Yet, what the Bulls conveniently overlook is the typical delay associated with Computershare, Revolugroup’s share issuing agent for fresh paper, and the entire administrative process.
Here’s how it works: Within 5 business days of exercise or cashless exercise, Revolugroup option holders (management & consultants) submit Treasury Orders to Computershare. The agent processes these orders over an indeterminate period, then issues the new shares, reports the increase to TSXV, and finally, the TSX Venture Exchange (TSXV) updates its share count on their official platform. This entire sequence can take up to two months, particularly if the Treasury Orders are submitted right at the deadline. The same lag applies to the public disclosure of financials, which should reflect any cash influxes from options exercises, though this too is subject to significant delays due to the customary few months between quarters/year-end and the final publication on SEDAR.
So, hypothetically speaking, if options were dumped into retail yesterday, we might not see an increase in the share count until mid-October. Consider a scenario where the share price hovered around 5 cents on July 16th, allowing for cashless option exercising; those new shares might not show on the share count until mid-September, and it would take even longer for them to appear in the financial statements.
Moreover, we can’t ignore the fact that past management, who are no longer obligated to disclose stock sales per SEDI, held substantial amounts of 5-cent paper. For them, breaking even or perhaps even making a modest profit could seem like a win, especially considering they’ve probably had nearly a year of compensation derived from the previous funds "invested" in the last private placement.
While I’m not certain of the average share price among the bulls, management is sitting pretty with options at 5 cents, and tens of millions of shares also at 5 cents are potentially poised to be offloaded into the market.
Here’s some food for thought based on 5-cent shares:
At $0.55, you’re looking at a 9.52% gain.
At $0.60, it’s an 18.8% gain.
At $0.65, that jumps to 26.9%.
And at $0.70, it’s a tidy 33.3% gain.
Given the recent Meridien hype propagated by the bulls (by the way, does anyone yet know where Meridien Holdings is headquartered, who the directors/shareholders are, or what it does?), we've seen a few trading days with over a million shares changing hands. These kinds of gains would certainly look tempting to both option holders and former management. Worth considering, don’t you think? I wonder how many retail shareholders would attain a gain selling at the above levels? We may never know.